Land prices recede but at slower pace

Land prices as of Jan. 1 declined from a year earlier as the real estate market returned to stability after the disasters last March, the fourth straight annual decline but at a slower pace, the government said.

According to an annual survey released by the land ministry Thursday, land prices fell an average 2.3 percent in residential zones and 3.1 percent in commercial zones, compared with last year’s 2.7 percent and 3.8 percent.

The ministry said that among 26,000 locations surveyed nationwide, 90.6 percent of about 25,500 spots saw prices drop last year.

Based on a land price survey last July, however, the findings show both residential and commercial land prices fell at a slower pace in the second half of last year, suggesting the market is starting to recover from the March 2011 quake and tsunami. Land prices in the second half fell 0.9 percent in residential zones and 1.2 percent in commercial zones.

Among areas devastated by the March disasters, Fukushima Prefecture posted a larger year-on-year fall. But other areas saw some land prices rise after the catastrophe, slowing the overall decline in the year to Jan. 1, the report said.

“In general, Japan is on a recovery trend from the disasters,” said a ministry official.

In Miyagi Prefecture, the rise in the price of land on higher ground, which has become much sought after following the tsunami damage coastal areas suffered, helped narrow the prefecture’s average decline in residential land prices to 0.7 percent. The rate was the second-lowest among the 47 prefectures.

The price of a lot on a hill near Ishinomaki soared 60.7 percent, the biggest increase recorded by the nationwide survey, while nine of the 10 largest increases were seen in Miyagi.

However, the largest price drop for a residential lot also was seen in the prefecture — an 18.3 percent decline at a tsunami-ravaged point in Kesennuma.

Fukushima Prefecture posted a large average land price drop of 6.2 percent in residential zones and 7.2 percent in commercial zones because of the meltdowns at the Fukushima No. 1 nuclear plant. The ministry excluded 17 points in the 20-km no-go zone around the wrecked facility from the survey.

Hard-hit Iwate Prefecture, meanwhile, saw the pace of decline slow to 4.8 percent in residential zones and to 7.0 percent in commercial zones.

Among the three largest metropolitan areas, land prices in Nagoya fell 0.4 percent in residential zones and 0.8 percent in commercial zones.

“Land prices might have hit bottom there,” another land ministry official said.

The costliest real estate recorded was ¥27 million per sq. meter at two commercial sites in Tokyo, in the upscale Ginza shopping area and the Marunouchi business and shopping district.